Sunday, July 12, 2020

I invested in my first stock on November 27. I bought two shares in a small Bitcoin Trust (NYSE:GBTC) that was, at the time, trading at $9.54. That’s where my investing story begins, as a 14-year-old in his freshman year of high school.

I sold it at $12.01. I know, not a great return, but for my first stock, at least I made some money.

Something that a lot of people don’t know is that the stock of a company doesn’t actually reflect how the company is doing. It’s based on how people think the company is doing. Stocks can climb and plummet at the utterance of a word or the release of quarterly numbers. Politics is one of the main movers and shakers of the stock market, and when you understand what influences those stocks, you can make good inferences on when to buy or sell.

With the help of CNBC, I found SOXL, a stock that specializes in semiconductors, which are devices that are found in radios, computers and cell phones. My dad, who also likes to invest, appreciated my findings and decided to invest in it himself, and gave me a 10% finder’s fee. I sold my shares at an opportune time, and made $300. As I’m writing this, I just sold 300 shares in an Israeli company that focuses on cashless payments (i.e. credit cards) and turned a profit there too. Now I won’t bore you with more buy and sell orders, but to keep it simple, I’ve owned some shares and made some money.

The golden rule of stock investing is never invest more than you can stand to lose. Now with the stock market in a huge downturn because of COVID-19, it doesn’t need to be said that most stocks have plummeted farther down than Korach’s family. There’s three directions the stock market could head, as I see it—a V-formation, where we immediately bounce back to the prices we were at before the virus; a U-formation, where the stocks gradually rise up over time back to their former glory; and an L-formation, where we don’t necessarily recover from the hit we’ve taken. I personally have my bets placed in a U-formation return, but things change quickly.

When oil prices dipped into the negatives, I was considering buying UCO, the ProShares Crude Oil ETF (an ETF is a collection of curated stocks that you buy into when you buy a share), but decided to wait. When I woke up the next day, the shares had shot up 1500%. I was devastated that I lost out on such a huge opportunity to make money, but in the end, Hashem—and another rule of the stock market—came through: Don’t follow the herd, keep a calm and clear head. Myriads of people climbed onto UCO, but it turns out the company was doing what’s called a reverse split, which basically is when the company makes the available stocks fewer, thus driving up price, which resulted in shares being advertised as one price, but were really another, and people saw those low prices and decided to buy in.

I was following the ordeal on Yahoo Finance, which hadn’t given any indication that the reported numbers would be disproportionate for the day. In the end people lost money because they bought stock in an item that, at the time, was literally worth nothing. The points that you see in the stock market are actually people, and you could see the people piling off UCO the second they realized what happened.

There’s a lot to know about the stock market, and it’s taken me a while to learn what I know. Something I learned from the UCO fiasco is that it’s really important to understand what you’re investing in before you buy in. I research every stock before I invest, find out what they do, why their prices go up and down, and I read their press releases and media articles. It might not look like much to someone at a passing glance, but the stock market has had me, at times, more scared than a horror movie.

During the time that I’ve been home from school, I’ve started two mirroring social media accounts called “Stocks 101” on Instagram and TikTok. Now don’t worry, I’m not the one posting dances and challenges. I post short videos, with topics ranging from stocks I would recommend investing in, to stock 101s, and stock news analysis. My most popular video has over 20k views, and talks about stocks that have a strong chance of giving you a substantial return. The great thing is that due to video size limitations, I have to keep it under one minute. Why is that great? People today have such short attention spans that keeping it short enables them to actually watch if they are interested. That’s why I have an attention-grabbing title and a strong first couple of seconds. I hope to be able to keep it up and expand to a bigger following.

The stock market is an uncontrollable beast; sometimes it’s your friend and the next day it wants to sink you. Overall, my experience in the stock market has been good, and I can assure you, it never gets boring.

Joey Ostroff is a freshman at the Rae Kushner Yeshiva High School in Livingston. He lives in Highland Park and davens at Congregation Ahavas Achim.